How AI Liability Risks Are Challenging the Insurance Landscape

Partner Thomas Bentz, who co-chairs Holland & Knight's Insurance Industry Team, was quoted in an International Association of Privacy Professionals (IAPP) article about how artificial intelligence (AI)-related liability risks are complicating the insurance landscape as insurers grapple with where AI-driven incidents fit within existing coverage. As AI becomes more widely used, providers have to evaluate how organizations manage AI risks including governance, data handling and employee training as well as weigh whether to provide coverage or add exclusions. Mr. Bentz explained that, coupled the relatively new nature of cyber liability insurance itself, insurers will need time to determine what a policy should cover and how it should apply to emerging risks.

"I think that there's a lot of confusion and growth in this industry, because where these claims fit is still kind of being figured out," he said. "So, for example, if an AI program causes bodily injury, does that fall under your (commercial general liability), your general liability type of coverage, or does that fall on your cyber coverage? You have got some of these gaps that really don't fit nicely into either program."

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